Should you start an innovation-as-a-service business? You have seen companies struggle to introduce new products and services to markets. You have been inspired by startup literature and its methodologies. You are thinking about taking the concept of innovation, turning it in to a service, and booking your whole client calendar full for the year.
I have bad news for you. You are heading for an uphill battle.
Companies don’t usually buy innovation. Here are three reasons why:
1. You won’t be missed
The process of innovation starts from an opportunity (a situation where customer needs can be matched with a creative combination of resources) and ends in a concept describing features and benefits of the new product or service. The initial opportunity is usually not discovered in a business meeting while reading the latest technology report. Instead, it’s more often discovered by employees who interact with customers or engineers who experiment with different technologies. Surprisingly many inventions are nothing more than accidental discoveries.
The person who discovers an opportunity becomes an intrapreneur. The intrapreneur will take the opportunity and start molding it into a product concept. They will experiment, fail and iterate by themselves or in a small team.
They will also start promoting the idea inside the company. But only after they have the concept. The concept will get approved by the C-level people. The concept will get the internal resources. Not the opportunity.
After the concept gets approved, the external consultants are brought in to draw the designs and write the code. At no point did anyone consider giving you a call. They didn’t know they needed your innovation expertise.
2. Your batting average will be low
When do clients buy work from you? It’s when they know they need what you’re selling and they trust that you can deliver.
Clients don’t buy work from you when they want to create value, save time, increase revenue or solve problems. They want those things constantly. It’s only when they trust you to give those things to them will they buy from you.
In any domain this trust is extremely hard to build. But if you’re trying to sell innovation, it’s going to be even harder.
We all know how difficult it is to build new businesses. 9 out of 10 startups fail. More than half of new products created by existing companies will either fail or never reach the markets.
You know this and your clients know this. There will be more failures than successes in your portfolio. Clients will treat you with reasonable skepticism rather than blind optimism.
3. You’re selling hay to a farmer
The bottle neck of innovation is not the lack of ideas but the ability to nurture the right ones. Kodak invented the first digital camera. Xerox developed the first personal computer. The right idea was there. It just didn’t get the support it needed.
People love to come up with ideas. Being creative is fun. If there’s a challenge or an opportunity inside your company, everyone will come up with their own idea for solving it.
It’s also much harder to keep an idea to yourself than to share it with someone else. Not only do we like coming up with ideas, but we also love telling other people about them. If you start writing down everyone’s ideas and collect them in to a single pile, that pile will grow and grow. It will start to resemble a haystack.
Managers inside your company acknowledge the existence of this metaphorical haystack. It takes up space in their minds. It creates anxiety and aimlessness.
And then you call them and offer to add some more hay to the haystack.